MIRA INFORM REPORT

Report Date :

09.06.2012

IDENTIFICATION DETAILS

Name :	WELCO TECHNOLOGY (SUZHON) LTD.
Registered Office :	198 Xinglong Streetsuzhon 215512 Suzhou Induistrial Park
Country :	China
Financials (as on) :	31.12.2010
Date of Incorporation :	18.03.2002
Com. Reg. No.:	320594400003800
Legal Form :	Wholly Foreign-Owned Enterprise
Line of Business :	Assembling of Rinted Circuit Board
No. of Employees :	1,300

RATING & COMMENTS

MIRA’s Rating :

Ba

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Status :	Satisfactory
Payment Behaviour :	No Complaints
Litigation :	Clear

NOTES :

Any query related to this report can be made on e-mail: infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List – March 31^st, 2012

Country Name	Previous Rating (31.12.2011)	Current Rating (31.03.2012)
China	A2	A2

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

Company name and address

Welco Technology (Suzhon) Ltd

Currency in this report is Chinese Yuan unless otherwise stated.

Exchange Rate: 1 USD=6.37 Chinese Yuan

"--"in this report indicates "unavailable" due to insufficient information or "no comments"

ORDER INFORMATION

name	Welco Technology (Suzhon) Ltd.
address	198 Xinglong Streetsuzhon 215512 Suzhou Induistrial Park
tel.	86512 63838860 ext 8758
e-mail	cecilia.huang@wongswtsz.com
other information	Creditamount:US $ 25,00,000.00 Agaisnt da in terms

Note:

1. The given telephone No. “63838860” is not correct. The correct No. should be “62838860”.

EXECUTIVE SUMMARY

DATE OF establishment	Mar. 18^th, 2002
Aic Registration No.	320594400003800
REGISTERED LEGAL FORM	wholly foreign-owned enterprise
REGISTERED CAPITAL	USD 24,000,000.00
main BUSINESS	assembling of rinted circuit board
TURNOVER	922,549,000.00 (As of Dec.31^st, 2010)
net profit	72,717,000.00 (As of Dec.31^st, 2010)
total assets	792,646,000.00 (As of Dec.31^st, 2010)
net worth	367,451,000.00 (As of Dec.31^st, 2010)
employees	1,300
import and export permits	yes
EXCHANGE RATE	1 Usd=6.37CNY

Registered Address	No.198 Xinglong Street, Suzhou Industry Park, Jiangsu Province
Zip Code	215126
Business Address	No.198 Xinglong Street, Suzhou Industry Park, Jiangsu Province
Zip Code	215126
Telephone	86 512 62838860
Fax	86 512 62830728
SIC Code (China)	4062 manufacture of printed circuit board

REGISTRATION

Name (Chinese)	华高科技（苏州）有限公司
Name (English)	Welco Technology (Suzhon) Ltd
Date of Establishment	MAR. 18^TH, 2002
Registry	Administration Bureau for Industry and Commerce - Suzhou
Legal Representative	Cen Dingji
AIC Registration Number	320594400003800
Registered Legal Form	Wholly foreign-owned enterprise
Registered Capital	USD 24,000,000.00
Operating Duration	Mar. 18^th, 2002 to Mar. 17^th, 2052
Business Scope	Assembling of printed circuit board, manufacture of computer peripherals, electronic communication products, new type electronic parts, electronics and other related products; Sales of self-produced products and related service
Changed in registration	Jan.6^th, 2009-01-06 Subject’s legal representative was changed from Wen Minqiang to Lin Xichong. Sep.26^th, 2010 Subject’s legal representative was changed to Lun Yongquan. Sep.27^th, 2011 Subject’s legal representative was changed to Cen Dingji.

Wholly foreign-owned enterprise

This form of business in PR China is defined as a legal person. It is a limited co. established within the territories of PR China with capital provided totally by the foreign investors. More than one foreign investor may jointly invest in a wholly foreign-owned enterprise. The investing party/parties solely exercise management, reap profit and bear risks and liabilities by themselves. This form of companies usually have a limited duration is extendible upon approval of Examination and Approval Authorities.

REGISTRATION INFO: AVAILABLE

FINANCIAL REPORTS: AVAILABLE

FIELD INVESTIGATION

Subject’s income comes mainly from assembling of printed circuit board and sales of computer peripherals and other electronics. It mainly provides circuit board processing service for the clients. The clients are mainly domestic and international electronic manufacturers and electric appliances manufacturers. The industry of printed circuit board is an industry with fierce competition. There are a lot of similar companies in the local place as subject’s competitors. However, with long history, subject has accumulated certain popularity and customer network in the market. Its overall competitiveness is above average in the local place.

Located at the shore of Taihu Lake and the nearby the estuary of Changjiang River, Suzhou city hold convenient traffic condition with major railways and highways crossing the city. It is not only the cultural and educational center of Jiangsu Province, but also important economic, trading and logistics center. In 2011, the GDP of Suzhou City ranked No.6 in china mainland.

SHAREHOLDERS AND SHARES

As indicated in the following table:

Shareholder	Capital Subscribed	Percentage
WONG'S ELECTRONICS (HOLDINGS) LIMITED	USD 24,000,000.00	100%
Total	USD 24,000,000.00	100%

Shareholder	Way of Investment	Paid-up Percentage
WONG'S ELECTRONICS (HOLDINGS) LIMITED	Capital	100%

Background of major shareholder

Name	WONG'S ELECTRONICS (HOLDINGS) LIMITED
Country	Hong Kong
File No.	0417499
Date of establishment	1993/4/27
Legal form	Private company
Current status	Active

AFFILIATE(S)

No affiliate of subject is found after checking.

MANAGEMENT

Name	Cen Dingji
Title	Chairman; general manager
Working experience	Industry experience: more than 10years; Management experience: more than 10 years
Name	Wen Minqiang
Title	Director
Name	Wang Xianmin
Title	Director
Name	Chen Zihua
Title	Director
Name	Yu Dadi
Title	Director
Name	Liang Mingyao
Title	Supervisor
Name	Miao Chunzhi
Title	Supervisor

NUMBER OF EMPLOYEES

Employees: 1,300

Management Staff: 50

Recent recruitment: Yes

Job-hunting websites	Job title	Number
http://www.o-hr.cn/recruit/jobs_com2881_id414713.html	technician	1
http://www.o-hr.cn/recruit/jobs_com2881_id414713.html	Warehouse mamanger	1
http://www.o-hr.cn/recruit/jobs_com2881_id414713.html	Project manager	1
http://www.o-hr.cn/recruit/jobs_com2881_id414713.html	Material department leader	5

BANKERS INFORMATION

Bank name	Bank of China – Suzhou Branch
Account No. (CNY)	--
Tel.	86 512 67555128
Comment	The bank information was provided by subject’s staff. However, the bank staff refused to disclose any information.

OFFICE FACILITIES

Geographic Location	No.198 Xinglong Street, Suzhou Industry Park, Jiangsu Province
Area	12,000.00 square meters
Environment	Industrial zone
Traffic condition	With neighborhood to Qingqiu Street, Susheng Road etc. the traffic condition is good.
Purpose	Office; warehouse; plant
Property Ownership	Self-owned

WEBSITE

Website	http://www.wongswec.com/
e-mail	cecilia.huang@wongswtsz.com
Operation status	Operational
Copyright	Subject’s affiliated group
Language	English; Chinese

TRADEMARKS/PATENTS

After checking with the Trademark Office of Chinese Administration Bureau of Industry and Commerce and the State Intellectual Office, no trademarks or patents of SC were found.

MAIN PRODUCTS & SERVICES

Main business	Assembling of printed circuit board
Products and services	Subject is the assembling factory of the Hong Kong company WONG'S ELECTRONICS (HOLDINGS) LIMITED. It provides OEM service of television, electronics, and computer related products for the clients. Moreover, it also manufactures and sells computer peripherals, e-communication products and electronic parts.
Plants and equipments	Surface assembling machine, circuit testing machine, welding machine etc.

SALES INFORMATION

Domestic sales	40%
Regions	All over China
Major domestic clients	Electronic products manufacturers
Competitors	SHENGYI TECHNOLOGY CO., LTD; CHINA CIRCUIT TECHNOLOGY (SHANTOU) CORPORATION; SUZHOU GOLD CIRCUIT ELECTRONICS CO., LTD; GUANGZHOU TIANLI CIRCUIT CO., LTD
Payment terms	Prompt payment; on credit
Export	60%
Regions	Hog Kong, South Korea, USA, Europe, Asia etc.
Major overseas clients	ABB INC; HONEYWELL INT'L INC; WONG'S ELECTRONICS (HOLDINGS) LTD
Payment terms	L/C, T/T
Subject mainly provides OEM service for the clients. With long history, it has fixed customer network.
The above information was confirmed by SC’s employee.

PURCHASE INFORMATION

Main Commodities Purchased	Plastic shells, wires, cables, testing machine, insertion equipment
Number of Major Suppliers	About 5
Region	Domestic:65 % Import: 35%
Major suppliers	SHANGHAI RAYCHANT ELECTRRIC MACHINERY ENGINEERING CO. LTD; WONG'S ELECTRONICS CO LTD
Main Terms of Payment	Local: Prompt payment; on credit Import: L/C, T/T
Subject’s raw materials are mainly provided by the clients. The equipments are purchased both domestically and internationally.
The above information was confirmed by SC’s employee.

CREDIT

Name of supplier	SHANGHAI RAYCHANT ELECTRRIC MACHINERY ENGINEERING CO. LTD
Main commodities and service supplied	BA system design; testing service
Interviewee	Manager Shi (business department)
Telephone of Interviewee	86 21 66581872
Payment comment	The investigated person confirmed that SC is one of their clients and SC’s credit status is good.

LITIGATION RECORDS

After checking with China Court organization, the local court website and other major searching websites, no litigation record related to SC in the latest three years is found.

OTHER ADVERSE MEDIA INFORMATION

N/A

MEDIA INFORMATION

Subject’s introduction information: http://www.goldhr.com.cn/grad/mingqifengcai/20070713/42713.html; http://jixie.cciru.com/corp-669802.html

FINANCE

Balance Sheet (Unit: 1,000 Chinese Yuan):

	Dec. 31^st, 2009	Dec. 31^st, 2010
Current assets
Money capital	185,713	231,447
Short-term investment
Notes receivable	159,329	331,752
Net ball of Account Receivable
Payment in advance	3,096	2,427
Subsidy Receivable
Other Account Receivable	14	799
Inventory	70,285	135,043
Expenses to be deferred
Other current assets	143	174
Export rebates receivable
Total current Assets	418,580	701,642
Long-term investment
Long-term investment
Original value of fixed assets	142,481	155,311
Accumulated depreciation	80,225	95,372
Net fixed assets	62,256	59,939
Fixed assets depreciation reserve
Net Value of Fixed Assets	62,256	59,939
Fixed assets in liquidation
Projects being constructed	23,778	24,852
Fixed assets losses in suspense
Total fixed assets	86,034	84,791
Intangible assets and deferred assets
Intangible assets	6,376	6,213
Deferred assets
Total intangible and deferred assets	6,376	6,213
Other long-term assets
Other long-term assets
Total assets	510,990	792,646
Current liabilities
Short-term loans	61,385	183,446
Notes payable
Account payable	132,558	207,252
Deposit received
Other accounts payable	3,612	9,443
Wages payable	6,902	10,276
Welfare payable
Tax unpaid	5,454	7,360
Unpaid profit
Accrued expenses
L/T debt due in 1 year
Other current liabilities	6,345	7,418
Total current liabilities	216,256	425,195
Total L/T liabilities	0	0
Total liabilities	216,256	425,195
Owner’s interest
Paid-up capital	189,682	189,682
Contributed surplus	46	46
Surplus reserves
Unconfirmed investment loss
Undistributed profits	105,006	177,723
Minority interest
Total owner’s interest	294,734	367,451
Liabilities and owner’s interest	510,990	792,646

Income Statement (Unit: 1,000 Chinese Yuan):

	Dec. 31^st, 2009	Dec. 31^st, 2010
Main business income	550,723	922,549
Main business cost	488,168	797,541
Tax and associate charge	156	494
Main business profit	62,399	124,514
Other business profit
Operation expenses	3,734	4,384
- management expenses	22,950	38,383
Financial expenses	-380	2,295
Operation profit	36,095	79,452
Investment profit
Subsidy income
Non business income	3,392	3,975
- non business expenses	1,986	1,110
Prior year income adjustment
Total profit	37,501	82,317
- income tax	4,419	9,600
Minority stock holder’s interest
Net profit	33,082	72,717

Important Ratios:

	2009	2010	(industry) 2010
Return on net assets (%)	11.22	19.79	8.00
Return on total assets (%)	6.47	9.17	3.93
Net profit margin (%)	6.01	7.88	4.50
Turnover of total assets	1.08	1.16	0.88
Turnover of current assets	1.32	1.31	1.71
Turnover days of account receivable	104.05	129.49	93.66
Inventory turnover days	51.80	60.91	48.48
Asset liability ratio (%)	42.32	53.64	50.14
Current ratio	1.94	1.65	1.20
Quick ratio	1.61	1.33	0.95

Major Financial Information (Unit: 1,000 Chinese Yuan):

	2009	2010
Main business income	550,723	922,549
Total profit	37,501	82,317
Net profit	33,082	72,717
Total assets	510,990	792,646
Total liabilities	216,256	425,195
Total owner’s interest	294,734	367,451
Source from	government	government
Whether audited or not	Yes	Yes

Analysis of financial indicator

Subject’s profit indices of 2010 are high which indicates its profitability is good. The turnover of total asset and current asset shows its asset operation capacity is average. Longer inventory turnover days indicate its inventory management is not strong. With high turnover of A/R, subject’s A/R recovery speed is good. With asset liability ratio in reasonable range, its long-term solvency is good. The current and quick ratio indicates its short-term solvency is also good.

INDUSTRY PROFILE

Industry

SIC Code (China): 4062 Manufacture of Printed Circuit Board

Description: Manufacture of circuits and circuit components

Status Quo & Trend

Printed circuit boards are important electronic components. China has become the most important manufacturer of printed circuit boards in the world. From January to November in 2010, there were totally 908 large-sized enterprises in printed circuit board industry with total turnover of 225,795,985,000.00 CNY (increasing 29.34% from 2009 y/y) and total profit of 9,402,876,000.00 CNY.

As an upstream industry of electronic information industry, PCB industry has been dominated in electronic industry. It is predicated that the market scale of global mobile phones will be increased to USD 341.4 billion in 2015. Driven by consumption of electronics such as mobile phones, PCs, etc, domestic and international PCB industry has been increasing in recent two years. In the future, as 3G mobile phones and digital TVs are widely used, PCB industry will be further developed

Industry Associations

Name of association	Membership of subject (Yes/No)
China Printed Circuit Association	No
Taiwan Printed Circuit Association	No
European printed circuit board association	No

GENERAL COMMENTS

Established in Mar. 2002 as a wholly foreign owned company, subject is engaged in assembling of printed circuit board. Its clients are mainly manufacturers of electronics and electric appliances. With long history, stable and experienced employees and powerful shareholder background, subject has accumulated certain popularity in the industry.

Subject’s sales volume of 2010 increased largely from 2009 due to its good business development. Its profitability is good. High A/R indicates is capital is partially occupied by the clients. This is good for subject’s sales expanding, but also would increase the bad debt risk. With reasonable asset liability ratio, its solvency is good.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.55.36
UK Pound	1	Rs.85.64
Euro	1	Rs.69.21

INFORMATION DETAILS

Report Prepared by :

PRL

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
--	NB	New Business	--

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.